Longhorn MD opens up about his professional life in an interview
The new boss at Longhorn Publishers was an insider, handpicked to replace Simon Ngigi who resigned after three years at the helm. He has taken up the corner office at a time when the industry is facing digital disruptions. Wahome previously worked at Price Waterhouse Coopers for eight years. In an interview with The Standard, he says his trick is changing his workers into entrepreneurs to sniff new opportunities in the drastically changing market.
Longhorn has had a challenging period in the last two years, how did you manage to bounce back?
Initially, there was a change in curriculum that affected classes one, two and three, so we had to develop new products to fit the competence based system from the old knowledge based one. It took us two years to transition, identify the right authors, develop learning materials and get the Kenya Institute of Curriculum Development approvals. In the next seven to 10 years, we are on solid ground with well-developed production. The overhaul is ongoing and the next set of classes to be affected will be four and five. The market is solid and growing. We posted Sh183 million last year up from Sh134 million and turnover grew from Sh1.45 billion to Sh1.69 billion.
Do you think the firm was reliant on a limited business stream and the digital disruption just came and swept the model away and how are you addressing this?
The key is diversification so that any dramatic change does not affect us. We do not just want to rely on the textbook but other products like creative works, reference books like the Atlas, dictionary and Kamusi so that if coursework changes it does not affect the business. Geographical diversification is also key. We have expanded into the regional market in Uganda, Tanzania, Rwanda, Zambia and Malawi. We are now in Senegal, where we intend to use it as a launchpad to other Francophone and West African markets, including Cameroon, Ivory Coast and Burkina Faso.
How are you addressing the digital challenge given that it is the new normal?
There is a huge shift globally towards mobile learning and our focus is enabling the user to have content on mobile and tablets. Monetizing it will depend on content. For example, subscription-based or free content which we can then advertise. For instance, we have the free online Kamusi where we make advertisement revenues. There is the opportunity to have virtual schools where lessons are recorded and classes are done on an e-learning platform. We want to go digital before the disruption gets to us, provide school learning material and create demand so that we cement our position in the market.
You are a finance guy and managing costs is crucial given that you had to cut staff. How did that work out?
From the bottom-line, we have improved operations efficiency by cutting production costs, especially the main cost which is printing and book development. Between July and September, we also reduced staff numbers by offering above market rate redundancy packages and managed to do it without a single lawsuit. We even followed up with some of them and helped them find placements in other companies.
How is the strategy to acquire Law Africa working out?
It has a niche market and a few players have actually looked in it. We are doing well, and it is an industry we are seeing growing, especially in the commonwealth countries where we have common law. We have a unique position that will allow us to go to Zambia, Tanzania and South Sudan. It will also allow us to digitize legal material and make it accessible to everyone globally. However, going forward, we do not intend to buy other companies but we will acquire rights to products.
Where do you see the company in the next few years?
We expect the digital platform to drive incomes increasing 20 per cent in Kenya over the next three years. Digital has higher margins even when we have not grown topline, require less capital and content is already prepared.
What key challenges does the business face?
The cost of living which affects buyers is a major concern as well as high fuel cost as a result of new tax levies. This affects printing and loading costs. We are also working with the Association of Kenyan Publishers to eradicate piracy, provide affordable material and ensure equality so that all Kenyan children have access and not just those from Nairobi.